Any business owner knows that one of the keys to long-term success – and, hopefully, growth that will continue into the future – is a strong, carefully thought out legacy plan. This legacy plan should not only be specific to the next generation of ownership and management – hand-picked to move the business forward – but it should also ensure that everyone is on the same page about how the business is run and what the individual role is. .
Many businesses already have legacy plans, but there are still plenty of reasons why disputes might arise. An unresolved argument or change of circumstances within a business – especially a family business, where emotions can easily get in the way – can create problems around inheritance.
Yet the key to avoiding these conflicts is still a strong legacy plan – and the key to a strong legacy plan is to devote plenty of time to creating and implementing it.
How do you create a strong legacy plan?
Whether your business is family owned or run, the key to a strong legacy plan is, of course, recognizing and investing in key talent – the future of business leaders who are strong enough will be fundamental to their future.
Another basis is expert input from someone who is in the best possible position to ensure that the plan is made without error, explanation or room for debate. A corporate solicitor has an invaluable pool of experience and knowledge, which means they can turn to the best professionals for help as you explore options and determine what you need to run your business successfully.
What does a corporate solicitor do?
Roughly speaking, a corporate and commercial lawyer will be an expert voice who will make sure that your business legacy plan is truly strong enough to see it through a storm of change, but nothing more than a formality.
In fact, here are some things that a corporate and commercial lawyer can help:
- Existing legal agreement, which can determine the value of your business. This is time consuming, and it results in a much higher margin for error
- They have a lot of experience on their side as a neutral third party, they can discuss arrangements related to any business partner or family members who may be involved in the negotiations.
- They will also be able to take on the task of keeping all your legal documents up to date and in a safe place. Again, this would otherwise represent a large drain of your time – the time you need to look at the day-to-day needs of the business – and increase the risk of error or oversight.
In addition to assisting in the formalities of creating a legal document, corporate and commercial solicitors are also able to help you differentiate between business needs and your personal plans for the future.
Avoid future conflicts
Like most things in life, communication is important. As you prepare the inheritance plan, discuss the process and your thoughts with family members and make sure they are always involved. Once a successor is chosen, take the time to reassure family members that their interests will be protected. Also, make sure you communicate how successors will be advised and trained for their future roles.
At the same time, make sure you clarify the role of everyone involved in the business. While some may be responsible for day-to-day management, others may only be involved in strategic direction. This will help avoid misunderstandings and ensure that everyone knows where they stand. Lack of clarity about expectations and responsibilities can lead to many problems.
Once the inheritance plan has been discussed, make sure it is formalized as soon as possible. Give the relevant parties a chance to speak, but know when to stop the discussion and move on knowing the decision has been made.
Working closely with your corporate solicitor throughout the process – and taking the time to communicate with other parties – will help avoid disputes and prevent inheritance disputes, thus saving potential long-term stress, time and costly legal fees.